"We simply must join the other states in the mid-Atlantic region to eliminate state boundary restrictions," the governor told the bankers at their annual meeting here. Pennsylvania must not be left behind in developing a new and stronger financial footing for economic development."

Thornburgh asked the association for help in securing approval by the State House of Senate Bill 1075, aninterstate banking measure passed by the State Senate in January.

The governor noted that West Virginia, Maryland, New Jersey, Ohio, Kentucky and the District of Columbia have all recently approved interstate banking measures which provide for "institutional alliances across state lines."

Competition for investment and new jobs among the states, he explained, is more intense than ever.

"Interstate banking is a key element of future economic growth," he said. "This kind of expansion will create more jobs, an attractive banking climate conducive to business growth and development, and a healthy banking environment which will produce new consumer services."

When asked if he feared the possibility of redlining and other discriminatory practices as huge banks move into certain areas of the state, Thornburgh said banking practices would continue to be monitored closely by government regulators.

"It's government's job to ensure that the financial community doesn't act to prejudice any sectors of the state," he said. "That's going to take some careful watch-dogging. The Department of banking has the power to deal with discriminatory practices."

Interstate banking developments in nearby states, according to the governor, are "prodding" Pennsylvania into action.

"I have a feeling we're very close to passing legislation in the Commonwealth to maintain our competitive status."